India’s August Trade Deficit Narrows To $26.86 Billion, Exports Rise 26%
Exports surged 26% as India’s August trade gap narrowed.
India’s merchandise trade deficit narrowed marginally to $26.86 billion in August from $27.2 billion a year earlier, as a sharp rise in exports outpaced the growth in imports. Data released by the Commerce Ministry showed merchandise exports increased 26.1% year-on-year to $43.8 billion in August from $34.7 billion in the same month last year.
Merchandise imports rose 14.1% to $70.6 billion in August from $61.96 billion a year earlier. Including services, the overall trade deficit narrowed to $9.41 billion during the month from $11.62 billion in the corresponding period last year. The Commerce Secretary said India is maintaining strong momentum in exports, with overall exports rising 25.4% to $82.7 billion from around $66 billion a year earlier, while growth in rupee terms stood at 37.6%.
The export performance was led by engineering goods, petroleum products, chemicals and textiles, with electronic goods and other manufacturing-linked segments also contributing significantly. The Commerce Secretary said export demand is coming not only from the US and the UK but also from BRICS nations and other emerging economies, pointing to a broader diversification of India's export markets. India’s exports crossed the $400-billion mark during the first five months of FY27, registering 15.5% growth over the corresponding period last year.
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The US, UAE and China were India's top export destinations in August, followed by markets including Singapore, Germany, South Africa, Malaysia, Tanzania, Hong Kong, Australia, Spain and Sri Lanka. During April-August FY27, merchandise exports to the US rose 6.2% to $42.8 billion, while exports to Japan increased 43% to $3.4 billion and shipments to South Korea grew 22% to $3.2 billion. Exports to BRICS countries rose 13% to $34.5 billion during the period.
Engineering goods, petroleum products, electronic goods, chemicals and drugs were among the leading export commodities during April-August FY27. On the import side, petroleum products, electronic goods, machinery and gold remained major contributors to the import bill. The trade deficit continues to reflect strong domestic demand for energy, machinery, electronics and other manufacturing inputs, with coal briquettes and electronic goods also accounting for significant import requirements.
India’s gold imports stood at $2.3 billion in August, while edible oil imports remained substantial. According to data from the Solvent Extractors’ Association of India, vegetable oil imports rose to around 1.609 million tonnes during the month, including 782,761 tonnes of palm oil. The latest trade figures underline continued export momentum alongside persistent demand for key imported commodities.
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